All Forum Posts by: Marina Shlomov

Well, this is what I learned so far...

Cashing out the properties - if you go with a conventional loan, you can cash out up to 4 properties. The good news, you can do it for as low as 4% annual, the bad news, you have to take them out of the company name and put it into your name, then, after refinancing, you can put them back into the company. Interesting! The process takes anywhere from 30 to 60 days to complete.

Not all Hard money lenders offer the the 30 year fixed financing to cash out, mostly, they are interested in fix and flips. Short, sweet and to the point. Rates are much higher. The hard money lenders that are doing the long term rental, have rates that go as low as 53/8% and as high as 7%. Time to close is usually 7 to 14 business days. You do have to watch out for hidden fees and other expenses. Read the mortgage documents very thoroughly (preferably ahead of time) so you know what you are getting into.

I am still debating the question, should I do the conventional or the hard money. The reason I am still debating is because I am not comfortable taking the properties out of the company name and putting it into my name, however, doing that offers me a much lower interest rate.

Am I wrong to NOT want to take the properties out of the company name? Am I opening myself up to liability if I put the properties into my own name? Maybe I am a bit paranoid, but I've been sued before, and having that extra layer of separation of personal and business is giving me warm and fuzzes. What do you think? 

BP community, I need your input!

We actually have only 3 properties that we accept Section 8 into, the rest of the properties we won't allow Section 8 tenants. Yes, we collected the full deposit the tenant, but that doesn't help when there is over $35K in damages. Needless to say, we won't accept any more section 8 into any of our properties, so that only leaves us 2 section 8 tenants.

And, we have done the same thing, We are slowly but surely letting go of all section 8, the government is too difficult to deal with. We had one instance where the inspector took off half a month of rent because there was a spot of missing paint on the ceiling (which was there when the tenant moved in and the spot was the size of a quarter). It's frustrating, their rents are lower then the market, and the tenants are not appreciative of the opportunities they have. With that being said, we did have a few "normal" section 8 tenants that kept the house clean, took care of the yard and reported maintenance issues promptly, but that didn't happen as often as the other side where they didn't take care of anything.

I have always felt that it wasn't a good idea with the section 8 program, but now, since I've read everyone's comments, I am happy to say that the decision is made and we won't accept Section 8 tenants any longer.

I was feeling somewhat guilty for thinking the way I did, but now, with my anger subsiding a bit, the guilt is gone.

Thank you everyone!

Everyone, thank you. We don't generally rent to Section 8, but we do have 3 properties. This WAS one of them. Even though we could rent it out to non-section 8 people. Thank you BarbaryElchinn for the idea wit the linoleum. I might have it put in everywhere this time around. We generally do tile (it lasts for almost forever, just not in this case).

Thanks to all for the suggestions and support. 

I think that for a LONG while, I'll stay away from Section 8. Not my favorite people. I never wanted to be a "slum lord" and don't really want to deal with the slackers.

Btw, the section 8 lady who I rented to was a grandmother with 3 grand kids! Polite, quite, respectful. She did loose her section 8 after this.

Marina

Hi all,

I own many properties in Atlanta, GA and over the years have had many Section 8 tenants. Not all were a disaster, but the paperwork and the unreasonable inspection demands have finally got me down and we stopped renting to section 8. However, we still have a few properties that are Section 8 occupied. Over the years, we've had several expensive and negative experiences with the voucher program occupants and in the last month, one of our section 8 tenants has moved out. Now, we knew what to expect as we did an inspection prior to releasing them from the lease, communicated all that with the Section 8 program (they lost their voucher after their case worker so the video and the pictures), but still...I don't wont to be so negative and deny potentially "decent" people a good house to live in, but look at the pictures below!

We did the thorough screening, called references, checked on the property twice a year and interim maintenance reports, but I am still flabbergasted. The property is destroyed! At least $35,000 worth of damage (we are licensed builders and that would be our cost to repair). I didn't even know which photos to show you. Every single square inch of this property is like this. All the new tiles are broken, all the vanities that were brand new are destroyed, all new appliances are gone, cabinets - destroyed, stairs - need re-carpeting!

My thought is, I must have done something wrong somewhere! Don't know where and of course, at this point don't even want to hear the word Section 8 tenants.

Guys, what did I do wrong? What else could I have done to prevent this? Most of this damage occurred in the last 4 months, since we were there before and didn't see any of it.

What do you think? Do you rent to section 8 tenants? Did anything like this ever happen to you? What can I do to prevent this? I'm disgusted, shocked (mostly at the audacity of the lifestyle), angry at myself, my partner, my guys - just about at everybody, but mostly at section 8.

Even though we scan every single piece of paper, we still keep them. I know they are bulky, but it's something about an actual legal document (yes, scanned in color and all) I just can't throw away.

Marina

Screening is by far not the only reason for lower turn over rates. Property maintenance, tenant reward programs and customer service are probably more directly related to lower turn over rates. [Post edited to remove link directing to own site, please refrain from doing so]

I think having a mandatory maintenance program that is a reasonable cost is a great way to make sure our systems are maintained (we also clean the gutters once a year with the program) and homes are kept in tip top shape.

Hi Kimberly,

We charge $95 a fee of $200 if we have to come out and change the filter, It's meant more like a punishment as our cost is $95 (we have a licensed HVAC contractor to come out, he also checks the systems for proper function). Once we charge someone the fee, they change their filters regularly, The amount bites. But like I said, it's meant more as punishment for making us come out for something so stupid,

As far as the program, yes, we have some on the program and some are not. Only because we just instituted it a couple of months ago, and as the leases renew, we'll have everyone on the program by the end of next year, We just have a lot of properties and can't change the term in the middle of the lease. Our leases don't renew in the latter months of the year, actually, from August to January. So everything that comes up for renewal will have the clause for the maintenance program.

I hope I helped.

Marina

Hi Mathew,

HVAC filters is a sore subject with me, as our lease requires our tenants to change the filters, it's stated in our policies as well and they do get charged a fee if we come out to change the filter. With ALL THAT being said, we still get calls for malfunctioning HVAC's, come out, change the filter (as it's the core of the problem), charge the tenants and they still do it. We own a lot of properties, so we can't inspect every month, but we do it quarterly (it's still a lot for us), we tell them about changing the filter every quarter. It's not really necessary to change the filters monthly. We still get calls.

To alleviate the problem with the HVAC filters and some other minor repairs, we have put a program together as a part of our lease, it's a maintenance program that a tenant pays for (not much $10 to $15 a month) and we send out one of our contractors twice a year to change the filters. We also send tenants reminders to do it themselves as well. This little program covers the cost of sending someone out to replace filters, ensures that it's done at least twice a year, and the rest is taken care of by the tenant.

Official inspections are quarterly, unofficial - when our maintenance guys come out, they look around and report to us the condition of the house or if they see any violations.

Hope that helps.

Marina

Thanks everyone. 

Marina